U.S. President Donald Trump kicked off his tour of affluent Gulf nations on Tuesday with a visit to oil-rich Saudi Arabia, prioritising major investment deals over addressing urgent Middle East security issues.
Emerging from Air Force One on his first formal state visit, with a who’s who of U.S. business leaders, including Elon Musk in tow, Trump punched the air in a show of solidarity as Crown Prince Mohammed bin Salman greeted him on his arrival in Riyadh.
Trump will go on from Riyadh, which is hosting a Saudi-US Investment Forum, to Qatar on Wednesday and the United Arab Emirates on Thursday.
He has not scheduled a stop in Israel, a decision that has raised questions about where the close ally stands in Washington’s priorities.
“While energy remains a cornerstone of our relationship, the investments and business opportunities in the kingdom have expanded and multiplied many, many times over,” Saudi Investment Minister Khalid al-Falih said as he opened the forum.
“As a result … when Saudis and Americans join forces very good things happen, more often than not great things happen when those joint ventures happen,” he said before Trump’s arrival.
Trump hopes to secure trillions of dollars of investments from the Gulf oil producers.
In a meeting at the Royal Court, Trump called the Saudi crown prince a friend and said they have a good relationship, according to a pool report from the Wall Street Journal.
Trump recalled travelling to the kingdom in 2017 and said Saudi investment would help create jobs in the U.S.
He said jokingly that a $600-billion investment pledge by Saudi Arabia could be $1 trillion, repeating a figure he has cited before as he seeks investment from an important strategic partner.
“I really believe we like each other a lot,” Trump said.
Big Investments
At the Saudi-US Investment Forum, at the front of a palatial hall sat Larry Fink, the CEO of asset management firm BlackRock, Stephen A. Schwartzman, CEO of asset manager Blackstone, Treasury Secretary Scott Bessent, and Saudi Finance Minister Mohammed Al Jadaan and Falih.
Musk chatted briefly with both Trump and the crown prince, who is otherwise known as MbS, during a palace reception for the U.S. president. And joining Trump for a lunch with MbS were top U.S. businessmen, including Musk, the Tesla and SpaceX chief, and OpenAI CEO Sam Altman.
MbS has focused on diversifying the kingdom’s economy in a major reform programme dubbed Vision 2030 that includes “Giga-projects” such as NEOM, a futuristic city the size of Belgium. Oil generated 62% of Saudi government revenue last year.
“About a billion dollars of investment is being made in frontier technologies and obviously it is no surprise that the lion’s share’s of these investments has gone into U.S. companies,” NEOM Deputy CEO Rayan Fayez told the forum.
The kingdom has scaled back some of its ambitions as rising costs and falling oil prices weigh.
Saudi Arabia and the U.S. have maintained strong ties for decades based on an ironclad arrangement in which the kingdom delivers oil and the superpower provides security in exchange.
MbS’ ties with Trump have been smoother than with his predecessor, Joe Biden. Their relations were strained by the 2018 killing of Saudi commentator Jamal Khashoggi by Saudi agents in the Saudi consulate in Istanbul. U.S. intelligence believed the killing was ordered by MbS. He denied involvement.
Trump has said he may go on Thursday to Turkey for planned talks on Russia’s war in Ukraine. He has also been pushing for a new aid mechanism for Gaza and urging Israeli Prime Minister Benjamin Netanyahu to agree a new ceasefire deal there.
Israeli officials have put a brave face on Trump’s decision to bypass Israel during his trip, but there are growing doubts in Israel about its position in his priorities as frustration mounts in Washington over the failure to end the Gaza war.
Israel’s military operations against Hamas in Gaza and Hezbollah in Lebanon, and its assassinations of the two Iran-allied groups’ leaders, have at the same time given Trump more leverage by weakening Tehran and its regional allies.
U.S. and Iranian negotiators met in Oman at the weekend to discuss a potential deal to curb Tehran’s nuclear program. Trump has threatened military action against Iran if diplomacy fails.
Trump is expected to offer Saudi Arabia, Iran’s regional rival, an arms package worth more than $100 billion, sources told Reuters. This could include a range of advanced weapons.
Trump’s Middle East envoy, Steve Witkoff, said last week he expected progress imminently on expanding accords brokered by Trump in his first term, under which Arab states, including the UAE, Bahrain and Morocco, recognised Israel.
But opposition by Netanyahu to a permanent stop to the war in Gaza or to the creation of a Palestinian state makes progress on similar talks with Riyadh unlikely, sources told Reuters.
(With inputs from Reuters)
